European markets are set to open higher Monday morning as dollar strength took a breather and oil prices jumped. The FTSE 100 is seen 15 points higher at 6,790; the DAX is expected to open 3 points up at 10,688 and the French CAC should start 10 points higher at 4,514.
In France, former President Nikolas Sarkozy conceded defeat in the primaries for the 2017 presidential election. The second round to select the candidate for the ring-wing Les Republicains will be disputed next weekend by Francois Fillon and Alain Juppe.
In Germany, Chancellor Angela Merkel confirmed expectations that she will run for a fourth term in office. Meanwhile, the German economy should slowdown in the last quarter of this year, after a solid performance in the first six months of 2016, the finance ministry said Monday.
In the U.S. President-elect Donald Trump continues looking at potential cabinet members. Mitt Romney, a former critic of Trump’s, is reportedly under consideration for secretary of state.
On Monday, President Mario Draghi of the European Central Bank is expected to speak in Strasbourg to members of the European Parliament. In London, Prime Minister Theresa May and opposition leader Jeremy Corbyn will speak at the CBI Annual Conference.
In Asia, markets were trading mostly higher on Monday.
Asia markets found a new spring in their step, trading mostly higher on Monday, as dollar strength took a breather and oil prices jumped.
Helping to improve sentiment around Asia, the U.S. dollar index, which measures the greenback against a basked of currencies, eased off a multi-year high of 101.48 touched last week. The greenback was wavering at 101.19 against a basket of currencies as of 10:46 am HK/SIN.
“The dollar rally is probably running out of steam as the market seems to have fully priced-in the ‘Trump effect’ and an impending December rate hike,” said Margaret Yang, market analyst at CMC Markets, in a note on Monday.
Crude futures gained upward momentum during Asian trade, with U.S. West Texas Intermediate (WTI) crude up 0.98 percent at $46.14 a barrel, while Brent added 1.13 percent to $47.39. Both crude futures had risen nearly 5 percent last week.
The dollar held near 13 1/2-year highs against a currency basket in Asian trading on Monday, as investors stuck with bets that President-elect Donald Trump’s administration would adopt expansionary fiscal policies that will lead to higher interest rises.
The dollar index, which tracks the U.S. unit against a basket of six rivals, added 0.1 percent to 101.31, after adding more than 4 percent last week to mark its biggest weekly rise since March 2015. It notched a high of 101.48 on Friday, its highest since April 2003.
The dollar rose to 111.190 yen, its highest since early June. It was last up 0.2 percent at 111.09 as investors positioned ahead of U.S. Thanksgiving holiday later in the week. Tokyo markets will also be shut for a public holiday on Wednesday.
Expectations that a Trump presidency will usher in higher inflation and lead to faster-than-expected Federal Reserve interest rate increases have helped power the U.S. currency.
“The dollar-yen uptrend remains intact, but the pace of the rise could be slower,” said Masashi Murata, currency strategist for Brown Brothers Harriman in Tokyo, who predicts the pair to trade in a 109.50-112 range this week.
“It’s very hard to sell the dollar against the yen, in the current situation, beyond a certain level,” he said.